Study Says Independent Practice Decline Is Partly Due to EHR Implementation

by | Last updated on Sep 14, 2022 | Published on Jun 20, 2018 | EHR/EMR

The electronic medical record was expected to help cut back-office costs, improve quality of care and make important legal processes such as medical record retrieval easy and efficient. However, studies such as the one published on February 20th this year in the Journal of the American Medical Association (AMA) paint a different picture. The study mentioned in Medscape Medical News points out that billing costs were huge even at a large academic center with a fully implemented EHR system. These costs represented around 14.5% costs of primary care visits and 13.4% of costs for ambulatory surgical procedures. Another major concern is how EHR-related costs are forcing small physicians’ groups and solo providers to close shop and join large hospital systems. There has been an increase in hospital mergers, and large hospitals are seen buying up physicians’ practices and outpatient service providers.


Now, many regions of the United States have only one or two large hospital systems that dominate the market. As a result, prices are almost 15% higher at times than those in markets where there are 4 or more hospitals. This is according to the White House’s 2018 economic report. The present payment model is also a major deterrent for independent practices. Medicare reimbursement for a physician affiliated with a hospital is often more than that paid to a solo practitioner or member of a small independent practice. This is a major reason why independent practices and solo practitioners are slowly dying out.

Implementing an EHR system is no doubt costly for small practices. The AMA study authors say that the high costs incurred by independent and small physician practices is also due to complex billing systems that vary with each insurer. This becomes really challenging for physicians who have to adapt to various EHR requirements. Since there is no uniformity across the industry, physicians are perplexed. A family doctor may have a diabetes measure from United, another from Medicare, and yet another from Aetna. Each of these has a slightly varying definition of what diabetes is for that particular measure. This makes it very difficult for the physician to manage. Understanding this challenge, the American Association of Family Practitioners has asked CMS to find ways to make simpler what they consider a “daunting and often demoralizing framework.” In fact, most family physicians work with 10 or more insurers. The Association pointed out that primary care physicians spend around 6 hours daily interacting with their EHRs during and after clinic hours. They have to understand the rules and forms for each insurer and spend a lot of time reviewing documents and checking boxes to meet payer requirements.

EHRs cost physician practices up to $32,500 per physician in 2015 according to a 2016 Medical Group Management Association (MGMA) study. These expenses included IT equipment, staff, and maintenance. Many physicians are also concerned about a reduced ROI following health IT adoption because EHR implementation would reduce the number of patient encounters.

A more thoughtful, pro-active approach is required if EHR adoption is to be successful and provide practitioners with all intended benefits. There is no doubt that advanced technology can make processes such as medical chart reviews simpler and more accurate. But there are many other considerations, especially regarding heavy investment and ROI – these are major concerns for independent and small physician practices. Healthcare practitioners, healthcare systems, EHR vendors and the government must all work together to find practical solutions to the problems and ensure a more efficient healthcare network.

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